Widening the Gap: ADP Data Shows Wage Inequality Worsens for Women When Bonus Pay is Considered
"We're looking at pay equity in a very unique manner," said Ahu Yildirmaz, co-head of the
Differing Gaps Exist Across Age Groups:
When categorizing new hires by age and income, women ages 20 to 30 with a low starting salary had near-equal base pay of men; however, the base salary gap worsened for females after six years. Additionally, when bonus is factored in, young women fared the worst with a 21 percent less bonus-to-base ratio compared to their male counterparts.
However, for the 40-50 age group, men and women started their careers with almost no base salary gap for all income groups, and women did well keeping up with men in base salary growth for the next six years. In fact, in most groups, they closed the base salary gap. The disparity here is with incentive pay, especially with the lower income group. In the
When looking across industries, incentive pay made some very distinct impacts. Women working in the Information sector make 7 percent more in bonus to base ratio than men, which lessened their overall gap in total earnings. In contrast, women in the Finance and Real Estate industry are earning 21 percent less in their bonus to base ratio compared to men. The industry has the largest pay gap for women with and without incentive pay.
The average bonus amount for women was less than two-thirds of the amount paid to men who had equivalent base pay, age, and tenure. This incentive pay disparity was observed across all age, salary, and industry groups from moment of hire and persisted throughout the six-year study window.
About the Rethinking Gender Pay Inequity in a More Transparent World Report
The Rethinking Gender Pay Inequity in a More Transparent World study gives an unprecedented look at gender pay inequity to determine the relative contributions of recruiting, base pay, and incentive pay to an overall gender pay disparity across the U.S. workforce. The study took an anonymous sample of men and women—newly hired into exempt salaried positions, in the third quarter of 2010—and tracked their base pay, incentive pay, and average total income through
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